ANNOUNCEMENT TANCO HOLDINGS BERHAD ( TANCO OR COMPANY )

Transcription

1 ANNOUNCEMENT TANCO HOLDINGS BERHAD ( TANCO OR COMPANY ) PROPOSED DISPOSAL OF ONE (1) PIECE OF FREEHOLD AND VACANT LAND IDENTIFIED AS HS(D) PT 2790, MUKIM PASIR PANJANG, DAERAH PORT DICKSON, NEGERI SEMBILAN BY PALM SPRINGS DEVELOPMENT SDN BHD TO CWH MARKETING SDN BHD 1. INTRODUCTION The Board of Directors of Tanco ( Board ) wishes to announce that Palm Springs Development Sdn Bhd (Company No X), a wholly-owned subsidiary of Tanco, had on 28 June 2013 entered into a Sale and Purchase Agreement (hereinafter referred to as SPA ) with CWH Marketing Sdn Bhd (Company No.: A) ( CWH ) for the proposed disposal by Palm Springs Development Sdn Bhd ( PSD ) of one (1) piece of freehold and vacant land identified as HS(D) PT 2790, Mukim Pasir Panjang, Daerah Port Dickson, Negeri Sembilan (measuring in an area of approximately 32,405 square meters) for a cash consideration of RM20,900, only ( Purchase Price ), subject to the terms and conditions as stipulated in the SPA. 2. INFORMATION ON TANCO, PSD AND CWH 2.1 Tanco is a public limited company incorporated in Malaysia and listed on Bursa Malaysia Securities Berhad ( Bursa Securities ). Tanco and its subsidiaries ( Tanco Group or Group ) are principally engaged in investment holding, provision of management services, properties development, management and operation of resorts, vacation ownership schemes, and point-based schemes and investments properties. Tanco has an authorized share capital of RM1,000,000,000 comprising 1,000,000,000 ordinary shares of RM1.00 each ( Tanco Shares ), of which RM334,886,726 comprising 334,886,726 Tanco Shares had been issued and fully paid-up, as at 27 June 2013, being the latest practicable date prior to the date of this announcement ( LPD ). 2.2 PSD is a wholly-owned subsidiary of Tanco with an authorized share capital of RM125,000,000 comprising 125,000,000 ordinary shares of RM1.00 each ( PSD Shares ), of which RM110,000,000 comprising 110,000,000 PSD Shares had been issued and fully paidup, as at the LPD. The principal activity of PSD is property development. 2.3 CWH was incorporated on 7 December 2007 as a private limited company under the Companies Act, 1965 with an authorized share capital of RM1,000,000 comprising of 1,000,000 ordinary shares of RM1.00 each ( CWH Shares ), of which RM600,000 comprising 600,000 CWH Shares had been issued and fully paid-up, as at the LPD. The registered office of CWH is at No. 53G, Jalan Orkid 6, Taman Orkid Batu 9, Cheras, Selangor. CWH is principally involved in the business of general trading of consumer products and investment. As at the LPD, the directors and shareholders of CWH are Lim Kwang Hooi and Low Boon Thiam.

2 3. DETAILS OF THE PROPOSED DISPOSAL 3.1 DESCRIPTION ON THE PROPERTY The property comprises of one (1) piece of freehold and vacant land identified as HS(D) PT 2790, Mukim Pasir Panjang, Daerah Port Dickson, Negeri Sembilan, measuring in area approximately 32,405 square meters (hereinafter referred to as the Property ) The Property is subject to the category of land use of Tanah ini hendaklah digunakan untuk bangunan kediaman sahaja The transfer of the Property is subject to the consent from the relevant State Authorities The net book value of the Property based on the latest financial statement of the Tanco Group for the financial year ended ( FYE ) 30 June 2012 is RM10.01 million The Property is presently unencumbered, but is pending the discharge of a fixed charge and was acquired in year 1994 by PSD at a cost of approximately RM7.38 million. 3.2 SALIENT TERMS OF THE SPA The salient terms of the SPA are as follows: Sale and Purchase PSD has agreed to sell and CWH has agreed to purchase the Property on an as is where is basis and subject to all the existing conditions of the title and category of land use, expressed or implied upon, relating to or affecting the Property State Authorities Consent The parties have agreed to mutually cooperate and support each other to procure the relevant State Authorities consent to the transfer of the Property to CWH Terms of payment (a) (b) (c) Upon signing of the SPA, CWH is to pay an initial deposit sum of RM209, only to PSD. Upon receiving the State Authorities consent to transfer the Property (referenced as the Approval Date ), CWH is to pay a further deposit sum of RM1,881, to PSD. The balance of the Purchase Price of RM18,810, only shall be paid by CWH to the appointed stakeholder solicitors not later than the date falling on the expiry of three (3) months from the date of the Approval Date or such extension as may be provided in the SPA Interim Access CWH would be granted interim access to the Property between the hours of 9am 6pm on weekdays only to enable it and its consultants to view and prepare preliminary plans, for which CWH shall bear the risk of damage to the Property.

3 3.2.5 Delivery of Vacant Possession Upon full settlement of the balance of Purchase Price together with interest (if any) vacant possession of the Property shall be delivered to CWH. PSD will undertake to permit and facilitate the access to the Property, connection of sewerage piping, and provide the utilities supply connection up to the boundary of the Property, upon the request of CWH. 3.3 ASSUMPTION OF LIABILITIES There are no liabilities, including contingent liabilities or guarantees, which will be assumed by CWH from the Proposed Disposal. 3.4 BASIS AND JUSTIFICATION FOR ARRIVING AT THE PURCHASE PRICE The Purchase Price of the Property was arrived at on a willing buyer willing seller basis after taking into consideration the following: (i) (ii) (iii) the original cost of investment of approximately RM7.38 million; and the net book value of the Property based on the latest financial statement of Tanco Group for the FYE 30 June 2012 which is RM10.01 million; and the asking prices of similar properties in the area. Based on the size of the Property of approximately 348,804 square feet (equivalent to approximately 32,405 square meters), the Purchase Price represents approximately RM59.92 per square feet. The asking price for similar residential land in Port Dickson is approximately RM27 per square feet and RM65 per square feet as published in iproperty.com on 21 June 2013 and 23 April 2013, respectively. 3.5 RATIONALE FOR THE PROPOSED DISPOSAL The Proposed Disposal provides an opportunity for Tanco to unlock the immediate value of the Property which is currently not generating any income for the Group. The Board is of the opinion that the Proposed Disposal is in the best interest of Tanco Group as the Proposed Disposal will enable Tanco to raise funds for the working capital requirements of the Tanco Group. 3.6 PROPOSED UTILISATION OF PROCEEDS FROM THE PROPOSED DISPOSAL The proceeds arising from the Proposed Disposal shall be utilized for the working capital of the Group after paying all incidental costs to be incurred in connection with the Proposed Disposal. It is expected that the proceeds arising from the Proposed Disposal shall be fully utilized within twelve (12) months from the date of receipt of the full amount of Purchase Price. However, the Company has yet to determine the proportion of the proceeds to be used for the working capital at this juncture.

4 3.7 ESTIMATED TIMEFRAME FOR COMPLETION OF THE PROPOSED DISPOSAL Barring any unforeseen circumstances, the Proposed Disposal is expected to be completed before the end of the financial year ending 30 June CASH COMPANY OR PRACTICE NOTE ( PN ) 17 COMPANY The Proposed Disposal is not expected to result in Tanco becoming a cash company or PN17 company. 4. FINANCIAL EFFECTS OF THE PROPOSED DISPOSAL 4.1 Earnings The Proposed Disposal will result in an estimated one-off gain on disposal of RM1.54 million or approximately 0.46 sen per Tanco Share for the financial year ending 30 June Net Assets ( NA ) per Share and gearing The Proposed Disposal will not have any material effect on the NA per share and gearing of the Group. 4.3 Share Capital and Substantial Shareholders Shareholding The Proposed Disposal will not have any effect on the issued and paid-up share capital and the substantial shareholders shareholdings of Tanco, as the Proposed Disposal does not involve issuance of any new Tanco Shares. 5. PERCENTAGE RATIO The highest percentage ratio applicable to the Proposed Disposal pursuant to paragraph 10.02(g) of the Main Market Listing Requirements is approximately 7.61% based on the latest audited consolidated financial statements of Tanco for the FYE 30 June RISK FACTOR The completion of the Proposed Disposal is subject to the consent from relevant State Authorities to transfer the Property to CWH, failing which may result in the SPA being terminated. However, PSD will take all reasonable steps to obtain the consent from the relevant State Authorities and to facilitate the timely completion of the Proposed Disposal. 7. DIRECTORS AND MAJOR SHAREHOLDERS INTERESTS None of the Directors and/or major shareholders of Tanco and/or persons connected to them have any interest, direct or indirect, in the Proposed Disposal.

5 8. APPROVAL REQUIRED Save for the consent from State Authorities for the transfer of the Property to CWH, the Proposed Disposal is not subject to the approval from the shareholders of Tanco or other governmental authority. Barring unforeseen circumstances, PSD will submit the application to the State Authorities for the transfer of the Property to CWH within thirty (30) days from the date of the SPA. 9. STATEMENT BY THE BOARD The Board, having considered all aspects of the Proposed Disposal, is of the opinion that the Proposed Disposal is in the best interest of the Company. 10. DOCUMENT AVAILABLE FOR INSPECTION The SPA will be available for inspection by the shareholders of Tanco at the Company s registered office at No. 1, Persiaran Ledang, Off Jalan Duta, Kuala Lumpur during the normal business hours from Mondays to Fridays (except public holidays) for a period of one (1) month from the date of this announcement. This announcement is dated 28 June 2013.